Some of India's largest drug companies have reduced the prices of 886 drug formulations, but health activists and some doctors have described the move as a ploy by the drug industry to evade meaningful price control.
The government last week released a list of formulations for which the drug companies have voluntarily reduced the prices by amounts ranging from 0.26% to 74% below current prices.
Officials at the Indian Ministry of Chemicals have said that the 11 companies submitted individual lists in response to ongoing government initiatives to work with industry to reduce the retail price of drugs.
The formulations cover many classes of drugs, including analgesics, antibiotics, antihypertensives, antipsychotics, and vitamins. Government officials have also said that efforts are under way to reduce the prices of more formulations. But health activists have criticised the list, saying that it creates a misleading impression that the drug industry has made important concessions.
Pharmacology experts say that most of the drugs in the list are not prescribed by doctors but are sold through retail outlets. “These formulations make up a tiny fraction of total drug sales in India,” said Chandra Gulhati, editor of the Monthly Index of Medical Specialities in India.
“None of the companies have reduced the prices of any of their top 20 drugs,” Dr Gulhati said. Government officials have said that they are studying the implications of this list, but they concede that it seems to cover only a small proportion of revenues from drug sales throughout the country.
Industry officials have defended the list, however, saying that the prices of drugs in India are already among the lowest in the world. “Competition between producers of generic medicines is one of the factors that ensures that prices remain low,” said an official at one of the 11 companies.
The All India Drug Action Network, which represents non-governmental organisations that campaign for access to essential medicines, has been urging the government to introduce price controls that are based on the cost of production of specific drugs.
“The retail prices of some drugs in India are exorbitant, compared with their cost of production,” said Anurag Bhargava, an internal medicine specialist at a community hospital in central India.
Health activists cite the relatively low cost at which the government procures drugs as evidence of the real cost of production. “It costs us two rupees to make a tablet of fluconazole and we sell it at 2.50 rupees (£0.03, $0.04, €0.04) per tablet. But other companies sell this drug for 30 rupees or higher,” said Sourirajan Srinivasan, an official with a company that manufactures drugs for government health programmes and which is not among the 11 that submitted the list.
The All India Drug Action Network has said high trade and retail profit margins and inefficient price regulation by the government have led to unaffordable medicines. The government's commission on macroeconomics and health said last year that the cost of buying medicines in India made up 80% of out of pocket expenses on treatment costs.